Getting the most from your stimulus check
Ernie Neve, CPA
June 4, 2020
As we kick off the summer of 2020, many of us are dealing with the fact that life as we know it has changed dramatically.
Jobs lost or furloughed, schools and businesses closed indefinitely, and worry and questions continuing to arise about what the rest of the year holds for us all.
By now, many workers in America affected by COVID-19 have received their stimulus checks and questions about a second check are up in the air. In the meantime, what are the smartest ways to budget those funds to get the most from them?
Let’s take a look…
· Don’t automatically spend it on food and housing. This may seem like the obvious place to spend this money, but with many states and HUD imposing a moratorium on evictions and foreclosures, your best bet might be to contact your landlord of the bank your mortgage is owned by and see if they can offer some assistance with your current or past due bills.
At the same time, thinking creatively about food and reaching out to local organizations like food banks and the SNAP program might be able to help keep more of those emergency funds in your pocket.
· Check with ALL your utility providers, too! The light, water, and even phone and internet companies have been nearly unanimous supporters of their customers, too, so be sure to simply communicate with them to see how they can help you. Some utilities are “floating” past due bills, others forgiving them, and still others are offering to dramatically cut current costs for their clients. One word of caution, though – the scammers are out there, so beware ANY third-party companies contacting you about ANY bill or financial obligations you might have. There has been a nearly fourfold increase in the number of reports of these types of activities. When in doubt, verify!
· No matter what, pay your insurance bills! While we’re seeing a lot of companies offering discounts in these days of dramatically limited driving, and it’s still worth calling and speaking with health, life, homeowners, and auto policies, don’t neglect these bills, because the LAST thing you need is an uncovered emergency on top of all the other things going on right now!
· Make “minimum” payments right now. Look, a LOT of us HATE carrying a balance on credit cards, and many of us have spent a long time to eliminate those debts that we allowed to creep up on us early in our lives. As such, for the short term, it’s not a bad idea to make minimum payments on any revolving debt – and that includes student loans, credit cards, and any other type of credit you might have. Now is definitely the time to hold on to cash and liquid assets, so while I’m not going to tell you to spend freely, having cash on hand is a smart thing in this current economy.
We’re all in uncharted waters right now, and while we wait to see how COVID will affect the economy in the future, taking care of yourself right now is important. As always, my team and I are ready to do whatever we can to help and support you, so reach out and ask!
And always, stay safe!